66 Neb. 415 | Neb. | 1902
On the 10th. of September, 1895, Robert Guthrie and David Guthrie executed and delivered to one E. P. Treat a promissory note for the sum of $4,660.93, payable three years after date, with interest at seven per cent., and at the same time executed and delivered to one A. Ludlow another promissory note for .the sum of $6,691.40, payable at the same time and on the same terms. To secure the payment of the said notes the said Guthries, together with their wives, executed and delivered to Treat and Ludlow a mortgage on certain real estate in Nuckolls county, Nebraska, conveying the said premises to said Treat and Ludlow7 jointly.. The said mortgage contained, among other provisions, the following: “First. Said Robert Guthrie and David Guthrie are justly indebted unto the said parties of the second part in the principal sum of $11,-652.33, lawful money of the United States of America, being for a loan hereof, made by the said parties of the second part to the said Robert Guthrie and David Guthrie, and in lieu of and renevml of two certain mortgages, one
On the 4th day of April, 1896, A. Ludlow, the owner of one of the abqve described notes, died, leaving a will, of which Henry Ludlow, Edward Ludlow and Willis Ludlow were appointed executors; and on April 11, 3896, all were duly qualified as such. On July 10, 1901, said executors sold and delivered to Henry Ludlow the note and mortgage owned by the said deceased, dated September 10, 1895, the same being one of the two notes in question herein. The Guthries having failed to pay said notes, or the debt'evidenced thereby, E. P. Treat and Henry Ludlow brought a joint action, or, in other words, joined in an action as plaintiffs to foreclose the mortgage, and alleged in their petition the facts above stated. Robert Guthrie and Frances Guthrie, his wife, answered the petition for themselves, setting forth that the debt in question was a partnership debt, and that certain of the property described in the mortgage was partnership property, and another portion of it was the individual property of them, the said Robert and Frances, and prayed that the partnership property be decreed to be first sold before resorting to their individual property for the satisfaction of the mortgage. David Guthrie and wife demurred to the petition. The demurrer was overruled, to which ruling they excepted and refused to further plead. A decree was en
1. It is contended by the plaintiffs that their demurrer to the petition should have been sustained, because two causes of action are improperly joined therein. This question is argued with remarkable ability by counsel, and many authorities are cited which, it is claimed, support their contention. We find upon an examination, however, that only a portion of these authorities appear to be in point.
In the case of Swenson v. Moline Plow Co., 14 Kan., 387, the facts were that S. executed to A. two promissory notes secured by a mortgage on real estate, and A. afterwards assigned one of the notes to M. It was held that A. and- M. could not sue jointly on the notes and mortgage, but that each had his separate action.
It Avas also held by the supreme court of Kansas in Harsh v. Morgan, 1 Kan., 293, that where A, B, O and D, held separate mechanics’ liens on the premises óf E, they were not interested jointly in obtaining relief, and could not be joined as plaintiffs.
In the case of Rankin v. Major, 9 Ia., 297, it was held that where one of several notes secured by a mortgage had been assigned, the holders of the notes were to be regarded as separate and distinct mortgagees, who could not be joined as plaintiffs to foreclose the mortgage.
At first blush these cases would seem to sustain the plaintiffs’ contention. An examination, however, of the methods of procedure in the courts of Kansas and Iowa
Jones, Mortgages [4th ed.], section 1368, lays down the following rule: “All those who are interested in the mortgage debt should, according to the general principle already stated, join in the suit to enforce the security. If the mortgagee is tlíe only party in interest, he is of course the only plaintiff. If several persons and even numerous
Maxwell, in his work on Pleading & Practice [4th ed.], p. 677, says: “All persons who are entitled to share in the money derived from the foreclosure should be joined as plaintiffs. If such refuse to join as plaintiffs, they may be made defendants. All persons who have united interest in the mortgage debt should join even where their interests are several, as where the mortgage was given to secure two or more notes which have been transferred to different persons.”
It is evident from an examination of the petition in this case that if only one of the plaintiffs had brought the suit to foreclose the mortgage, before any decree would have been rendered the court would have made an order bringing into the case, as a party defendant, the other joint mortgagee. Upon being so made a party, it would have been necessary for him to file an answer in the nature of a cross-bill in order to protect his rights and obtain the relief to which he would be entitled, and while he would be named as a defendant, yet as to the mortgagors he would still stand in the attitude of a plaintiff. To say that persons being so jointly interested can not join as plaintiffs, but that one must be a plaintiff and the other a defendant, is to sacrifice substance to form. We hold, therefore, that the demurrer upon this ground was properly overruled. We do not intend, however, to decide, and do not decide,
2. Plaintiffs further contend that there was a defect of parties; that the executors of the estate of A. Ludlow were necessary parties to the action, because the sale of the note by them to the plaintiff, Henry Ludlow, was void; that an executor could not purchase the estate of his testator. The fact, if it existed, that the plaintiff is the same person who was named as one of the executors, does not appear upon the face of the petition. So far as we are informed by the pleading in this case, the Henry Ludlow named as one of the executors was not one and the same person with Henry Ludlow the plaintiff, and we will not indulge in any presumption on that point in order to defeat the action, especially after the rendition of the decree. Again, the allegation contained in the petition, — that the executors, by virtue of the authority in them vested, sold and assigned to the plaintiff, Henry Ludlow, for a full and valuable consideration, the A. Ludlow note; and that Henry Ludlow, the plaintiff, is the owner and holder thereof,— is a sufficient allegation of a proper and legal sale, and raises the presumption that all of the steps necessary to invest the executors with power to sell the note have been taken. This defense, if available to the mortgagors, should have been raised by an answer, and could not be raised by demurrer. It is further contended that the sale of the note did not carry with it the original debt, and, therefore, said debt still belonged to the estate, and the executors of the estate were necessary parties. We do not so understand this question. There is no allegation in the petition that any notes other than the ones in suit were ever given, and the recitals contained in the mortgage itself do not raise a presumption that such was the fact. By a fair construction of the pleading it appears that the ’’otes in
3. Plaintiffs claim that this suit can not be maintained upon the notes and the mortgage described in the petition, but must be based upon the original notes and mortgages; that the petition, by not alleging plaintiffs’ ownership, or other disposition of the original notes, was rendered fatally defective. The weakness of this contention is that the petition does not disclose that any .notes were ever given, other than the ones described therein. The allegations of the pleading taken in connection with the recitals in the mortgage, — which is made a part thereof, — fairly show that the mortgage in suit was taken as a renewal, and as stated therein, in lieu of two certain mortgages: one executed in 1882, and the other in 1883, and of the original debt for borrowed money secured thereby. This fairly raises a presumption that the old mortgages were delivered up at the time of the execution of the one in suit. The fact that nothing is said in the petition, in the notes or in the mortgage itself, about the existence of any other notes fairly raises a presumption that there were no notes contemporaneous with the old mortgages. It is beyond question that whether the notes and mortgage in suit were renewals simply, or whether they operated as an extin-guishment of the original debt, or whether they are to be
We hold that the facts stated in the petition were sufficient to constitute a cause of action, and we recommend that the decree of the district court be affirmed.
By the Court: For the reasons stated in the foregoing opinion, the decree of the district court is
AFFIRMED.
In the 6th edition, Maxwell says: “It is a fundamental rule in equity that the court shall, if possible, do complete justice in a case by settling the rights of all persons interested in the subject-matter • of the suit.” Sec. 572. — W. F. B.